Alitalia’s Preliminary Agreement

After round-the-clock negotiations and last-minute maneuvers to shove Luigi Gubitosi down the throats of Alitalia’s minority shareholder (Etihad) in efforts to please Lenders (Unicredito Banca and Banca Intesa San Paolo), the Italian majority shareholders have apparently brokered a last-minute deal between Alitalia and the Unions, which, however, needs to be ratified by Alitalia employees before going into effect. Hardly more than a letter of intent!

Until Italians continue to buy the story that unions contracts are better and that for the privilege of making less money than they could earn by working for just about any other European airline, they need the skill and expertise of union representatives, these sorts of shenanigans will continue.

But what if Gubitosi & company don’t really want the “prelim” to finalize? What if the Italian majority shareholders hope the employees will vote against the “prelim” and/or go beyond the financial deadline in efforts to approve, thereby pushing the airline into insolvency and administration at the hands of a government-appointed Commissioner, like Gubitosi?

What if it’s all a ruse to get two birds with one stone: Alitalia goes into bankruptcy despite the best efforts of just about everyone i.e., the shareholders, the Unions and the Government with its promise to guarantee Lender loans. The employees wind up taking all of the blame. The Italian majority shareholders, Big Brass, Government and Unions, all of the credit. Gubitosi is put into the driver’s seat of a Newco with a clean slate, time and money to reorganize, preferably without foreign partners (that just don’t understand “us” anyway), and a return of the Government to the share capital of Alitalia. Score another win for state enterprise and government employment status for Alitalia workers? No, please tell me I’m wrong guys.